092. Platform Disruption…While Building Windows 7 [Ch. XIII]

Welcome to Chapter XIII! In this chapter we build Windows 7 and bring it to market. We start with all the forces that were shaping up to “disrupt” Microsoft (in the now classic sense) including the launch of the iPhone, cloud computing, consumer internet services, and even the perception of bloat (in Windows this time.) Each of these on their own would be significant, but they were happening all at once, while we were rehabilitating the team, hoping to ship on time for once. To add to the chaos of the moment, these forces appeared during the largest runup of PC sales, breaking 300 million units, followed by the biggest risk to PC sales growth driven by the Global Financial Crisis. A lot was going on competitively, setting the context in which Windows 7 would be built and launched. I thought about competition a great deal, so there is a great deal in this section.

Back to 091. Cleaning Up Longhorn and Vista

The days of competing head-to-head with our own past releases or with vaguely similar products were over. Windows faced outright substitutes, and they seemed to be working.

The Windows 7 team was progressing through engineering milestones M1, M2, and M3 with the energy and momentum increasing along the way, all while computing underwent radical changes at the hardware, platform, and user-experience layers. Everything appeared to be changing at once, just as we were getting our mojo back.

Microsoft’s products and strategy were being disrupted. We just hadn’t, or perhaps couldn’t, come to grips with the reality.

These disruptive forces appeared over the course of developing Windows 7, each one taking a toll on Microsoft’s platform value proposition. Each contributing to a small but growing chorus of changing times that started with the iPhone.

The iPhone was announced in January 2007, six months before Windows 7 Vision Day. The phone didn’t yet have an app store, an app SDK, didn’t run a full desktop browser, lacked push email for Exchange like a Blackberry, and even omitted basic copy and paste. Nobody at the time thought this phone was relevant in a competitive sense to personal computers. Heck, it even required a personal computer for some tasks.

Nobody except Steve Jobs.

We didn’t know the extent the competitive dynamic would shift a year later, creating a true and unforeseen competitive situation, an existential threat, for all of Microsoft.

I attended the iPhone launch event (rushing to it as it was the same week as CES that year) and walked away with a lot to think about for sure. It was easily one of the most spectacular launch events in the history of computing in my lifetime (after Windows 95 and the 1984 Mac launch and its toaster-size computer with a bitmap display that talked). Steve Jobs said one thing that proved to be incredibly important, with long-term implications overlooked by many [emphasis added, my transcription]:

We have been very lucky to have brought a few revolutionary user interfaces to the market in our time. First was the mouse. The second was the click wheel. And now, we’re going to bring multitouch to the market. And each of these revolutionary user interfaces has made possible a revolutionary product—the Mac, the iPod, and now the iPhone. A revolutionary user interface.

We’re going to build on top of that with software. Now, software on mobile phones is like baby software. It’s not so powerful, and today we are going to show you a software breakthrough. Software that’s at least five years ahead of what is on any other phone. Now, how do we do this? Well, we start with a strong foundation.

iPhone runs OS X. [applause]

Now, why, why would we want to run such a sophisticated operating system on a mobile device? Well, because it’s got everything we need. It’s got multitasking. It’s got the best networking. It already knows how to power manage. We’ve been doing this on mobile computers for years. It’s got awesome security. And the right apps.

It’s got everything from Cocoa and graphics and it’s got core animation built in and it’s got audio and video that OS X is famous for. It’s got all the stuff we want. And it’s built right into iPhone. And that has let us create desktop-class applications and networking, right.

Not the crippled stuff that you find on most phones.

This is real, desktop-class applications.

Most reviews mentioned it, but it did not take up nearly as much airtime as the touch screen. In fact, the absence of support for Adobe Flash in the iPhone browser seemed to even undermine this important fact for most. This important fact was the technology underlying the iPhone—the use of the full operating system was a massively strategic, risky, and difficult choice. Using OS X enabled Apple to gradually enable many Mac features over iterative development cycles, knowing that the code already worked. Apple could do this because it had bigger ideas for how it would break compatibility with the Mac and a bold new model for supporting developers to build third-party software. From the very start, the iPhone was destined to be a complete PC, only rebuilt bit by bit with a modern architecture and API. Not only did the iPhone bet on ever-improving mobile bandwidth as many criticized at the time, but it assumed mobile processors and storage would at least reach parity with the personal computer. In other words, from the very start the iPhone had a truck engine. (This reference will make sense in Chapter XIV.)

Windows had been taking the opposite approach which was to base the mobile platform on a nearly decades-old version of Windows, stripped down even, with thoughts though not goals of perhaps of catching up to the current desktop Windows by adding new code over time. The incredible challenges this decision introduced will become readily apparent, but only with the release of a new Windows phone operating system to compete with the iPhone. The diverging paths of Windows for mobile and laptop/desktop had been cast years earlier.

That summer, I lined up at the AT&T store at Pacific Place in downtown Seattle and picked up my black 4GB iPhone. Who needed 8GB on a phone? Some PCs were shipping with 4GB of storage and all of Windows XP. At the time of the launch announcement, I was quite skeptical of the touch keyboard and said so in an internal mail thread, pointing out if touch screens would work then Windows Phone had already tried and mostly failed. I had been a hardcore Blackberry (and later Palm Trēo) user since before general availability in the late 1990s. I was as much a CrackBerry addict as anyone. Some of the many Windows phones had a stylus like a Palm (or Apple Newton), but I never warmed to those and thought handwriting with a stylus was as dumb as Steve Jobs said at the launch. Within a few hours of having the phone (and a browser!), my worldview changed, especially about touch and especially about the evolution of operating systems. Even lacking copy and paste and relying on the slow AT&T 2G mobile network, you had to really try hard to not be impressed.

I remember emailing the co-founder of Blackberry and asking when there would be a full browser and in a long back and forth thread, he tried to convince me of the implications on battery life, lack of capacity on the phone network, and even the lack of utility. While months earlier I might have been sympathetic, I was now staunchly on the other side of this debate.

Inside the company, the iPhone went largely unnoticed outside of small pockets of people, and of course the phone team. Not because it was not a breakthrough product, but because it did not fully connect to our corporate mail service, Microsoft Exchange, as it was configured and permissioned by Microsoft’s IT group. Only those of us running on the testing servers, dogfood, were able to use an iPhone for email, and even then it had no support for our much-loved rights-managed email and Microsoft directory. There was a significant debate over whether maintaining this capability was good for self-hosting and competitive knowledge or bad for supporting competition. It was also about this time that support for using Blackberry was disabled. I put up a huge battle over this only to delay the inevitable. Making it difficult to fully host on competitive products was short-sighted but impossible to stop, even as a senior executive. This was done to “eat our own dogfood” even if the result meant truly innovative and competitive products would only receive cursory use.

While SteveB’s comments around the iPhone launch have become something of an historically bad take as he somewhat mocked the high price, it is crucially important to understand that he as much reflected as simply shared the collective viewpoint of the entire PC industry, and most of the mobile industry. Collectively, nearly every party underestimated the ability for Apple, with no experience in the mobile industry, to deliver a hit product while also resetting the norms of the mobile carrier business model—the same carriers that Steve Jobs described as “orifices” during an interview two years before the world knew about the phone.

The two fundamental assumptions of the PC industry that guided it to nearly 300 million units a year were low prices with consumer choice and a horizontal layering of hardware and software. This business model and technology architecture together enabled the PC. For all the struggles between OEMs, Intel, Microsoft and more, the success was indisputable, especially relative to the Apple model of premium price, limited choice, and a vertically integrated, single supplier.

Before the iPhone, the mobile phone seemed to be coming around to the PC model, with the Windows phone appearing to make progress against Nokia and Blackberry with many PC OEMs using a Windows phone software license to offer low price and choice to customers. Jobs would take this good news and make it appear bad by showing how Windows Phone was fragmented across phone makers, not a single OS. That drove the Windows Phone team crazy, particularly when Jobs presented the market share as a pie chart in 2008 basically rendering Windows Phone as “Other.” The iPhone would literally trounce the traditional OEM model. Choosing between a bunch of crappy devices is no choice at all, even if they all run a single platform. Jobs had long been making this point about PCs too, except now this all seemed to be working.

He was only partially right because in just a short time, Google would repeat the technical and partnership aspects of the Windows model exactly for phones, while upending the economic model and not charging for a software license, opting to further its advertising business model. Of note, the successful OEMs for Android turned out to be an entirely new set of partners, with none of the existing PC OEMs making the generational transition, perhaps in part because most had tried and failed when using Windows mobile software. The combination of iPhone and Android would leave Microsoft in a hopeless middle, with a shrinking partner ecosystem across OEMs and developers. The iPhone was not a broad or instant hit as is well-documented. History does not easily recall the bumpy first year because the following years went so spectacularly well.

Seemingly, at least for the moment, unrelated, there was that money-losing online retailer named Amazon.com led by Jeff Bezos plugging away on what Steve Jobs might have called a hobby or a side project. The company created Amazon Web Services, AWS, in 2002, though few noticed. The product was relaunched about a year before the iPhone with a new set of capabilities and two main new products: EC2 and S3, providing scalable on-demand computing and huge cloud-based storage. For developers, that marked the birth of the cloud era. Amazingly, perhaps, this new competitive front was not Google, which is where nearly all of our platform angst resided.

For Microsoft, this was all starting to sink in. We had competition on the client and at the infrastructure layer. We were getting squeezed on both of our platform businesses, Windows desktops and Windows servers.

Ray Ozzie (ROzzie) was leading a new project, code name Red Dog, with an incredible group of early Windows NT developers including DaveC. As chief software architect, ROzzie was looking to the cloud to reinvent the future of Windows Server, Microsoft’s dominant and extremely profitable business of running enterprise computing in customer-owned and -operated data centers. The running of important business functions in the cloud was still more than a decade away for Microsoft’s enterprise customers, but Amazon’s clarity of vision and the start-ups that gravitated to the approach were incredible. With the cloud, along came Linux as well. Microsoft already needed to catch up, but you had to look very carefully to believe that to be the case, as it was not at all obvious from a customer perspective.

Microsoft had invested a decade in building out Windows Server, a hardware ecosystem, databases, and the entire .NET stack along with a trained sales force. Suddenly AWS running on Linux with entirely new models of compute was the competitor. No salespeople required. To use AWS, developers just signed up online using a credit card and paid for what computing resources they needed as they needed. No hardware to buy. No servers to set up, maintain, and secure. No running out of disk space or network bandwidth. No need to buy more servers in case there’s a rush on the web site. A whole business could run off from laptop with a browser connecting to Amazon’s data centers in the cloud.

It was nearly impossible for many born of the Windows server world, whether at Microsoft or our customers, to fathom this approach. There were endless debates inside the halls and boardroom of Microsoft over whether this was crazy or fantasy. One of the most common debates centered around storing data and either how much bandwidth would be required to move data to or from cloud servers or how expensive cloud storage would forever be. To me these debates seemed rather like the debates over the browser taking over for Office—it is not a matter of if, but rather when everything aligned to make it possible and how different the resulting solutions would look from what we built today. The very existence of gmail seemed to demonstrate the present reality with the most mission critical of all storage intensive workloads, email.

We got so tangled up on how customers would migrate to the cloud, we did not really consider how much larger the market would be starting from nothing and growing cloud native. The irony of us failing to predict this same type of massive upside was almost too much, in hindsight, since that is exactly what gummed up the mainframe computing world and even the character-based (non-GUI) world of MS-DOS as the PC, Windows, and Office platforms took hold.

Additionally, when faced with disruption while substantially new ideas are fast pulling the market and customers in new directions, the previous generation of innovation does not stop. That is what makes it even more difficult for the new approaches to take hold with incumbents. At every step, we thought we would keep adding features in the direction we were going to keep winning. We were winning big. Microsoft’s revenue growth in 2007 and 2008 was 15% and 18% respectively, with 2008 revenue growing past $60 billion.

One example of this competitive pull was our focus on the biggest competitor to Windows Server, VMware. Why? VMware used virtualization to manage Windows Server and in doing so commoditized Windows as one of many alternative operating systems VMware could manage. It had started off as a brilliant invention for developers to isolate code under development on the desktop growing into a new components of enterprise infrastructure. We had been using it ourselves to simplify testing of Windows and even Office for several years already. If Windows Server could enable competitive virtualization, we could thwart the competition from VMware while also solving for the same scenarios Amazon seemed to be addressing with AWS but without Linux.

VMware was acquired (in a complex series of transactions) by a Windows partner, EMC, which soon after acquired a separate company started by Paul Maritz (PaulMa), the former leader of Windows. Paul transitioned to lead VMware as CEO, where he implemented the same enterprise playbook that helped to make Windows Server a success. VMware was rapidly becoming the enterprise standard for a new wave of enterprise datacenter management, which would turn out to be a stop along the way to a future of cloud. This mattered because it impacted the COSD team’s contribution to Windows Server and put the team in between two different versions of the future, being implemented by two different teams at Microsoft, each with serious competition—Red Dog building out one roadmap and Windows Server another. While one view might be that this was a prudent strategy, another view was that it was a strategy guaranteed to slow our progress to an inevitable future.

Our remaining competitive challenge was faced by Live Services. Competition was constant and coming from all directions. Many competitors came and went quickly, as was the norm in consumer, ad-supported services. Switching costs were low and whole populations changed quickly—it appeared to be a hit-driven business, which was not something Microsoft was geared up to navigate, especially after a failed decade of trying to make consumer and home software a thing with CDROM titles and later web sites. MSN Messenger and Hotmail had hundreds of millions of users, but daily active users (DAUs) were declining and engagement (usage time) overall was dropping. There was a good deal of advertising revenue, hundreds of millions of dollars, but it depended on intrusive display ads that riled users, even though the services were free.

Gmail rapidly became the new de facto leader in “free” email, offering essentially “unlimited” email storage in gigabytes while Hotmail was trying to build a business charging for extra megabytes. Originally announced as an April Fool’s prank in 2004 and released in beta, by the time the Windows 7 vision meeting took place Gmail had finally removed the exclusive invitation signup requirement. Though remained in beta, the service was exploding in use. While it would be a few years until Gmail surpassed Hotmail, Hotmail almost immediately stopped seeing growth and started to see a decline in engagement. Gmail was not a gimmick; under the hood was an enormously innovative database and operational capability. Gmail had no advertisements. None.

MSN Messenger, eventually Live Messenger, had become enormously popular around the world, especially outside the United States with hundreds of millions of active users. It too was facing an existential competitive threat. This time from Skype, a Swedish, Danish, and Estonian invention that offered free voice calls from almost any platform, notably both PC and Mac. While Messenger was often used to arbitrage SMS fees, Skype was arbitraging voice and creating a movement that would permit much of the world to skip using landlines for overseas calls when mobile minutes were incredibly expensive. Video calling was introduced as well, and while Messenger already had this capability, the cross-platform nature of Skype, as well as the focus on voice connections to local land lines, made for a much more compelling offering. Microsoft would finally acquire Skype from eBay (who had acquired it in 2005) in 2011 when it reached almost 300 million users worldwide, more than Messenger had achieved. In 2007-2009, Windows Live was still competing with Apple, Google, Yahoo, Skype, MySpace, and a host of category leaders across photos, blogging, and video. That was a lot.

SteveB and Kevin Johnson spent a great deal of time and energy on the potential of acquiring Yahoo, the dominant leader with which MSN competed. Such a deal would have added to my challenges given their email and messenger services were suffering much the same way. We might have gained in search and content services, but we would have added productivity services that were also losing share just as Windows Live seemed to be.

Apple struggled to find its way through the cloud and services world, even with the launch of iPhone. Apple’s decidedly client and device focused approach was quite similar to how we saw Live Services and Windows evolving together. The services would be augmented by rich “desktop class” applications for photos, video, messaging, blogging, and even productivity. Apple for years had been selling a suite of creativity products, iLife, later adding new productivity tools, notably Keynote for slide shows, called iWork. A collection of web services was originally called iTools then later rebranded as the .Mac service (pronounced “dot Mac”) and included email, online storage, and backup. In the summer of 2008, the service was rebranded MobileMe in a very bumpy launch that was not widely praised. After eight years and a good deal of iteration, Apple continued to work to find its way even as iPhone success grew.

The most disruptive announcement from Apple came a year after the initial iPhone launch. In 2008, Apple announced and then brought to market a software development kit with APIs to build third-party apps for the iPhone. This also included an entirely new store for software distribution and economic model for developers, the App Store. It is almost impossible to overstate the leap the App Store brought to computing. The PC was drowning in viruses and malware because of the internet—the ability in a few clicks to download software seemed wonderful at first, but then quickly became a cesspool of awful software that at best simply degraded the PC experience. Additionally, the world of PC software had stagnated simply because it was so large that it became almost impossible for a new desktop product to gain awareness, distribution, and enough sales to support a pure-play software company. In fact, Skype might be the most innovative native, though cross-platform, application to break through outside of browsers, and we acquired it in 2011 before it was profitable. While some would view the App Store as a sort-of closed ecosystem, it was literally the solution to the problems plaguing the PC. The Apple bet on OS X meant that there was a robust and proven platform and toolset to serve as a foundation, plus software distribution and economics. Developers hardly had all of OS X, but they definitely had a lot of it and Apple could add more over time.

Microsoft was steeped in a competitive mindset across every generation of leader and from many perspectives. BillG never missed an opportunity to cite some positive attribute or significant asset of a competitor. SteveB brought his relentless sense of competition from childhood math camp and sports. MikeMap and JeffH instilled this in all of us back on my first team with an intense business rigor. In working with the Windows and Windows Live role, I was faced with competition from more directions and with more depth than I ever thought possible. The team, at first as I moved into the role, seemed to consistently minimize this new reality. It would be rude to say Microsoft was in denial. I don’t think it would be unfair to say that after years of winning and even feeling like we had beaten back Linux and open source, Microsoft had become much more focused on its own universe of customers and their problems which was mostly immune to influences from outside that gravitational sphere.

In hindsight, that was what happened when two factors combined to create a step-function change in product trajectory.

First, the existence of a single massive product, Windows and the Intel PC ecosystem, Wintel, created constraints for those looking to build entirely innovative products. While many built products thinking of Wintel as an ingredient, amplifying the platform without posing a risk, a small percentage of risk-takers saw a different world. They saw the shortcomings of Wintel as an opportunity to reinvent. They built as though the leaders were not there and built what, in their eyes, the world should look like, whether they achieved critical mass success or not. Each of these new competitors had a worldview that revisited underlying assumptions about Windows and Windows Live and the PC ecosystem. Competitors assumed any web browser as the user interface, connected over the internet to Linux servers running open source software—no Windows Server or .NET at all. Google, Facebook, and a constellation of start-ups in Silicon Valley embraced this model as though Microsoft never existed. Even when it came to Microsoft Office, most new companies in Silicon Valley operated as though it was an insignificant part of the software landscape. In 2008, while Windows 7 was in testing as we tried to bring Internet Explorer back from hibernation, Google released the Google Chrome browser and with it putting an end to even that sliver of Microsoft as part of the next wave of innovations.

Second, the incumbent leader had to mess up. Customers generally didn’t spontaneously change, even if there was something better to switch to, because of processes, habits, and costs, and they don’t change all at once. Leaders messed up by ignoring new technologies, especially as over time little technologies added up to something material. Also, a risk was a failure to execute and deliver new products to market, simply dropping the ball. Microsoft mired in the journey through Windows Longhorn and a executing a Windows strategy put forth in the mid-1990s had indeed dropped the ball. It was increasingly difficult to appreciate or even see changes to the technology landscape when the company’s decision-making context is so dominated by goals, challenges, and issues entirely of its own making.

Waiting to pick up the ball was the competition born of the internet and web. While many wished to connect this potential disruption of Microsoft to the antitrust events and resulting settlement in the early 2000s, none of Apple’s iPhone, Amazon’s AWS, or Google’s Search or Gmail had anything to do with the trial and resulting settlement. Where some like to claim Microsoft was distracted, they would be wrong. If Microsoft was distracted, it was by simply trying to finish Windows Vista or compete with VMware or IBM or even Linux, or executing on our own plans and growth and dealing with issues like software security and quality. This wasn’t about the browser, the price of Windows, or even what software was installed on a PC. Those had already become old battles and irrelevant to the rapid structural changes that happened in software (the kind that produced Microsoft, then Windows, then Office in the first place). As fast as one company can rise to success, another can do the same in equally unexpected or counterintuitive ways. This was the argument or perhaps the defense Microsoft and BillG had put forth time and time again. No matter how many times BillG said this to the press, customers, or regulators none would believe him…even as it was taking place.

This was all happening as I was trying to get our house in order and make progress. Things just weren’t as simple as they were in 2005 when OEMs were just waiting on a new release of Windows. The PC makers were looking particularly unhealthy and deeply concerned about the rise of mobile phones on top of normal concerns about the price of components, delays in Windows, and the chip roadmap from Intel—would phones be an opportunity for PC OEMs or would they prove to be a generational change in hardware leaders as well? Should they be considering Linux on the desktop as a replacement of Windows given its popularity on servers?

SteveB, and increasingly the Board, had a lot of questions and concerns surrounding the competitive dynamic. Some board members were close to the hardware ecosystem and would oscillate between certainty that the ecosystem would deliver and that it would not. International board members were using Skype to talk to their families. Everyone wanted to know how to connect from their iPhones to their Microsoft corporate email or Windows Live personal mail, or why iTunes was so slow on Vista, or why Mac Excel was so different from Windows Excel as new Mac owners were discovering.

In fact, they were all asking how long it would be before they did everything on mobile phones. There was also deep concern over browsers, knowing it had been five years since the last release of Internet Explorer in 2001 and work had all but stopped. All of them wanted a PC as cool as a MacBook. Microsoft board members had a budget for PC purchases and always wanted to know the most Apple-competitive Windows laptop to buy, and for much of the duration of Windows 7 we had no answers. Each time I attended a Board meeting, I had to respond to all of these questions again.

Like Captain Kirk in ST:WOK (Star Trek: Wrath of Khan), I would look around and think, “Please, please…give us time…the bridge is smashed, computers inoperative.” We were rebuilding the team and trust with customers and OEMs. Windows 7 was going to pave the way for us to do big new things. There was little more we could do than get that done.

Whether it was desperation, a lack of alternatives, or simply misplaced confidence in the team, the questions kept coming yet there were few questions about Windows 7. Many were already looking beyond Windows 7, thinking, and plotting as though delivering Windows 7 was some sort of no-brainer.

Looking back, it was equally easy to ponder the radical idea of basically skipping Windows 7 and going straight for something to compete on these many fronts. We could theoretically catch up to these multiple competitive forces and not miss an entire cycle of innovation if everything was aimed at mobile and cloud. One big mega-strategy to build a new Windows, a new phone, and integrated cloud services.

That would have been absurd. It was the opposite of possible. The team was still recovering from the Vista release with its portfolio of stretch goals, to put it kindly, that did not go as planned. The last thing we should have even come up with was some sort of Longhorn-redo. Frankly, what we planned for Windows 7 was kind of crazy, given the recent track record. We planned Windows 7 and all the features with the assumption the team could deliver a major update to Windows, on time. Additionally, the Server team and its customers remained not only unconvinced of the cloud but actively campaigned against it. Besides, we had RedDog. Windows 7 had to serve both of those.

The impact and the constraints of the past had long-lasting effects.

While the Board was anxious about the post-Vista landscape, the technical trade press, mostly made up of Microsoft watchers, remained tuned to Windows. It was the product with the most familiarity, and the Vista release was causing difficulties. But the double-edged sword of the beat reporters was that they covered what we were up to, but not so much what we should have been up to, until it was too late. It would still be a few years before most reporters made the switch to Mac, but the switch to iPhone was happening quickly bringing renewed attention to Apple laptops.

At the same time, any little thing we did was chum in the water for the dozens of beat reporters covering Microsoft.

In the summer of 2007 word leaked out about the impending service pack for Windows Vista previously described. It was not a horrible leak, but it scrambled our OEM partners and immediately froze the few Vista enterprise deployments in process. The field sales team was livid that they had not been briefed on the release, again arguing for more transparency from Redmond. The problem was we had just gone through five years of transparency and every constituent was annoyed, at best. I wrote a 3000-word internal blog post “Transparency and disclosure” where I tried to put forth the idea that being transparent isn’t compatible with being good partners, but we needed to aspire to translucency (excerpt follows).

Transparent. Easily seen through or detected; obvious.

Translucent. easily understandable; lucid.

One topic I have been having an interesting time following has been the blogs and reports that speculate about how Windows will go from being an open or transparent product development team to being one that is “silent” or “locked down”. Much of this commentary seems to center around me personally, which is fine, but talks about how there is a Sinofsky-moratorium on disclosure. I think that means I owe it to the team to provide a view on what I do mean personally (and what I personally mean to do), of course I do so knowing that just by writing this down I run this risk of this leaking and then we’ll have a round of phone calls and PR management to do just with regards to “Sinofsky’s internal memo on disclosure”. But I thought it would be worth a try.

…

Customers and partners want to know about SP1 for Vista. Actually they need to know. We want to tell them. But we want to do so when our plans and execution allow that communication to be relatively definitive. We are not there yet. So telling folks and then changing the plans causes many more challenges than readily apparent. While it might sound good on paper to be “transparent” and to give a wide open date range and a wide open list of release contents, we all know that these conversations with customers don’t end with the “we’ll ship by date and we’ve prioritized ”. Folks do want to know “did you fix this bug?” That is reasonable, but we don’t have all those answers and thus we cannot have a reasonably consistent and reliable communication…yet. We are working towards that. While there is clearly a challenge in the near term in not offering details, this challenge is much less than if we get the wrong information out there and we have to reset and unset expectations. Even among our enterprise customers, for whom this type of information is routine, we have a long history of really scrambling these most valuable customers with “information” that turned out to be “misinformation”. The difference we are trying to highlight is the difference between transparency in what we’re “thinking” and transparency in what we’re “doing”. Everyone wants to know what we’re thinking, but making it clear that those are thoughts versus “doing” is a subtlety lost on a mass audience.

…

I know many folks think that this type of corporate “clamp down” on disclosure is “old school” and that in the age of corporate transparency we should be open all the time. Corporations are not really transparent. Corporations are translucent. All organizations have things that are visible and things that are not. Saying we want to be transparent overstates what we should or can do practically—we will share our plans in a thoughtful and constructive manner.

This too leaked. It became known as the “Sinofsky omerta” (awful) and the idea of being translucent was always said snidely. We had gone nine-plus months without any substantial forward-looking discussion of Windows. The reporters covering Microsoft were restless. The leaked blog post only served to amplify any other leaks.

A college student-blogger in Australia, Long Zheng, who had become somewhat of a canary in tracking Windows evolution, happened to catch an October 2007 college recruiting talk at the University of Illinois given by Eric Traut (EricTr), a Distinguished Engineer and one of the senior architects in COSD and a core member of the Windows NT architecture team. Eric was a key inventor of the hardware emulation technology used by Apple as it transitioned microprocessors the first time in the 1990s and then an early pioneer of virtualization at a competitor to VMware, Connectix, that Microsoft acquired in 2003.

EricTr presented a wonderfully detailed talk on the role of virtualization in modern computing, describing the work he did along with a number of the most senior people on Windows. He described the architecture of a modern scalable OS and the evolution of Windows over time. He even showed some code.

To that blogger, he had just seen a demo of Windows 7 or at least exactly what Windows 7 should be.

Zheng saw the presentation on a video posted on Microsoft’s own Channel9 website and promptly wrote a blog post about the future of Windows 7, referring to the talk as a “demonstration of Windows 7.”

It wasn’t that at all. What was so exciting, though?

Over the years there was that constant murmur underlying the evolution of Windows and its expression of bloat—expansion of code size, decreasing performance, the requirement that PCs have more and more memory just to keep up. Everyone’s PC got slower over time because of bloat. EricTr’s demonstration inadvertently played into this narrative and provided a huge hope for improvements in the future.

To implement virtualization, the OS kernel was being worked on to further reduce the impact it would have on memory and CPU consumption. Eric demonstrated this new “minimal kernel,” which he dubbed MinWin. This would be exactly the solution to every problem with PCs—if Windows was good but a bit bloated, then certainly a minimum Windows, or MinWin, would be what everyone would want. It would do everything Windows did but with minimal code. Who would not want that? If one set out to create an ideal branding to describe a release of Windows for every tech enthusiast, MinWin was it. As I read the blogger’s account, I thought “Oh my gosh, this is Office Lite, but for Windows”—it was a hypothetical product that did everything it needed to do, but was easier, smaller, faster, and lighter. What’s not to love? (See 076. Betting Big to Fend Off Commoditization)

Eric’s talk was about virtualization and scaling Windows Server. It was not at all about Windows the way most people thought about it. Eric described what he was showing as follows:

We created what we call MinWin. Now, this is an internal only, you won't see us productizing this, but you could imagine this being used as the basis for products in the future. This is the windows 7 source code base, and it's about 25 megs on disk. You compare that to the four gigs on disk that the full windows Vista takes up.

Everyone on the team, most certainly a COSD architect, knew the bloggers description that this was Windows 7 was incorrect—Eric even said so. Even assuming Windows was bloated, the OS kernel wasn’t the culprit. We ended up spending a lot of time with the press figuring out how to reduce the expectations and to not consider the next Windows some sort of “new kernel.” This backfired because they heard us downplaying expectations for the release overall. With our silence, this made sense, given the Windows history of overpromise and underdeliver. As word spread, we began to hear from enterprise customers who thought that a new kernel would introduce compatibility concerns, especially in the server. This was neither a practical nor theoretical issue.

The challenge this created was indirectly related to bloat. Rather, it created a perception that Windows 7 was going to be substantially “less bloated” (whatever that meant) than Windows Vista. That prompted people to talk about comparisons to the now, post-Vista, much-loved Windows XP. Nothing in the product plan had changed, but there was suddenly a perception Windows 7 would be dramatically improved.

The public expectations for the release went up, as if they weren’t already sky high. When the outer reaches of the company saw these stories, particularly where there were direct connections to customers, the optimism was contagious.

Scary? Sure. Except we already had thousands of people working on that very opportunity—making a leaner, more efficient Windows while also making it do a lot of new stuff.

The absence of information gave people ample room to create their own worldview. Many, especially SteveB and the OEM team, wanted to use this, or one of the other rumor cycles, to get out there with more information. The team was still in the early stages of executing, and we needed to make more progress. I did not want to be out there just yet. Besides, all I could do at that moment would be counter the now exaggerated expectations which would create more confusion and likely cause another news cycle condemning Windows 7 to be a limited or incremental update to Vista.

Just as the Fall computer selling season was gearing up, a new type of computer was all the rage in Asia and about to hit the US market. Maybe these “netbook computers” would breathe some life into Vista and buy us some time before we started talking about Windows 7?

On to 093. Netbook Mania

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